Oil Jumps After Trump Vows to Hit Iran ‘Extremely Hard’ — Commodities Roundup

Oil prices surged more than $5 on Thursday after President Trump vowed to hit Iran “extremely hard” in the coming weeks, quashing hopes of a swift de-escalation as the conflict entered its fifth week. In early European trading, Brent for June delivery leapt 6.6% to $107.82 a barrel, while May West Texas Intermediate rose 6.1% to $106.19. European benchmark natural gas also climbed, with front-month prices up 7.4% to 51.05 euros a megawatt-hour.

Energy markets rally on geopolitical risk

The renewed threat of escalation in the Middle East injected a fresh risk premium across energy markets. Traders focused on potential supply choke points and the possibility of broader disruptions spilling into shipping and infrastructure. Natural-gas benchmarks in Europe advanced alongside crude, reflecting both direct supply concerns and broader worries about inflation and growth.

Other developments across commodities

TotalEnergies and Masdar launch $2.2 billion Asia renewables JV

TotalEnergies and Abu Dhabi’s Masdar unveiled a $2.2 billion joint venture to consolidate and expand their onshore renewable portfolios across nine Asian countries. The platform will serve as their exclusive vehicle for developing and operating solar, wind and battery-storage projects in markets including Azerbaijan, South Korea, Indonesia and Japan.

Gold and silver slide as rate worries resurface

Precious metals turned lower as investors recalibrated expectations for interest rates amid higher oil and stickier inflation risks. Spot gold fell about 3% to roughly $4,670 a troy ounce, while silver dropped more than 5%. The retreat extended an 11% pullback in gold from its war-driven record, with some participants also taking profits ahead of the long Easter weekend. Rising rate expectations typically weigh on non-yielding assets such as gold.

Hormuz chokepoint looms large

Iran’s fortifications on small islands near the Strait of Hormuz—such as Kharg, Qeshm and Abu Musa—underscore its leverage over the vital waterway. Reopening the route to normal tanker flows could require action to secure these areas. Before the war, nearly 20% of globally traded crude passed through the strait; since late February, traffic has slowed sharply as hostilities intensified.

Market talk highlights

• Palm oil tracks crude higher: Bursa Malaysia’s June contract rose 25 ringgit to 4,794 ringgit a metric ton, supported by firmer crude prices, expectations of lower inventories and robust March export demand. Technical traders cited support near 4,690 ringgit and resistance around 4,830 ringgit.
• Copper softens on growth worries: London Metal Exchange three-month copper slipped 1.4% to $12,300 a metric ton as uncertainty around the conflict’s duration and potential U.S. escalation weighed on global growth expectations. Offsetting some pessimism, signs of demand recovery in China have lifted import premiums to a nine-month high and driven a sharp drawdown in stockpiles.
• Asian petrochemicals most exposed to Hormuz risks: Petrochemicals in Asia rely heavily on Middle Eastern crude, LPG and LNG, leaving the sector acutely vulnerable to transport disruptions. Japan and South Korea face the highest exposure given their dependence on imported naphtha and LNG. China’s greater use of coal as a feedstock offers partial protection, though coastal chemical hubs still lean on imported naphtha, LPG and LNG.
• Brent outlook steady near $100 in the near term: Analysts expect Brent prices to hover around $100 before easing later this year, projecting averages of $110 in 2Q, $100 in 3Q and $90 in 4Q, with $90 also seen in 1Q 2027. At one point, front-month Brent futures were up about 7% to $108.23 a barrel.
• Hormuz uncertainty to keep oil elevated: With no clear plan to reopen the strait, some forecasters maintain a 2Q average for Brent above $110 and assume the passage remains effectively shut until the end of April. The longer the disruption persists, the less relief can be expected from strategic reserves and inventory drawdowns, amplifying costs for the global economy.
• European gas risk premium may linger through 2027: The market is reacting more acutely to individual LNG cargo availability than to storage levels, raising the odds of short-term price spikes—especially during shoulder seasons. Entering winter with slimmer buffers could make Europe more sensitive to cold snaps, plant outages or supply interruptions.
• U.S. not immune to price shocks: Despite strong domestic energy resources, the U.S. remains exposed to higher global prices driven by supply-chain disruptions. Businesses and consumers may face rising costs, and growth could slow as inflation accelerates—pressures that additional shale output is unlikely to offset quickly.
• Summer gas tightness could force demand cuts: If disruptions persist, rebalancing may hinge on weaker demand rather than incremental supply. Industrial curtailments, fuel switching and power-market demand response are already in motion, with increased use of coal-fired generation under consideration or expansion in some countries. Newcastle coal futures for April climbed to $144 a metric ton, the highest front-month level since October 2024.
• Mining shares drop with precious metals: London and South African miners fell after the latest geopolitical remarks pressured gold and silver. Decliners included Fresnillo, Endeavour, Antofagasta and Anglo American, while South Africa’s Harmony also slid. New York gold futures fell 4% to $4,619.30 a troy ounce; silver dropped 7.3% to $70.54; platinum slipped 4.6% to $1,896.70.

Bottom line

Energy prices snapped higher as geopolitical tensions deepened, with crude and European gas leading gains and ripples felt across metals and equities. Market direction in the coming weeks will likely hinge on developments around the Strait of Hormuz and the inflation outlook shaping central bank paths.